Budget 2020: Reduce GST on bicycles to 5% from 12% to revive demand in rural markets, urges Hero Cycles

The company has also sought extension of FAME-II benefits to electric bicycles

Press Trust of India January 28, 2020 12:29:28 IST
Budget 2020: Reduce GST on bicycles to 5% from 12% to revive demand in rural markets, urges Hero Cycles
  • The company has also sought extension of FAME-II benefits to electric bicycles

  • The bicycles are largely used by low-income group and rural populations and therefore need to be made cheaper by slashing GST from the current 12 percent to the lowest 5 percent slab

  • Extending the subsidy benefits of FAME-II to electric bicycles will help manufacturers offer more affordable products to consumers, said Munjal

New Delhi: Leading bicycle maker Hero Cycles on Monday urged the government to reduce GST on bicycles from 12 percent to 5 percent ahead of the Union Budget to revive demand in the rural markets.

The company has also sought extension of FAME-II benefits to electric bicycles.

"The Budget must focus on reviving slumping demand across the country through a series of measures including re-adjusting GST slabs to put more disposable income into the hands of people," Hero Motors Company (HMC) Chairman Pankaj M Munjal said in a statement.

Budget 2020 Reduce GST on bicycles to 5 from 12 to revive demand in rural markets urges Hero Cycles

Representational image. AFP.


The bicycles are largely used by low-income group and rural populations and therefore need to be made cheaper by slashing GST from the current 12 percent to the lowest 5 percent slab, he added.

"Similarly, we also want the government to extend FAME-II benefits to electric bicycles," Munjal said. Lower GST on bicycles would provide relief to millions of low-income households, the company said.

"We hope the government recognises the need to promote electric bicycles as much as the need to promote electric cars. While electric cars address the problem of pollution, they do not address the concern of traffic congestion in Indian cities," Munjal said.

Electric bicycles are both eco-friendly and space-friendly and also offer a viable solution to the problem of range anxiety that comes with lack of charging infrastructure as they can be easily pedaled back in case of battery loss, he added.

Extending the subsidy benefits of FAME-II to electric bicycles will help manufacturers offer more affordable products to consumers, Munjal noted.

Follow full coverage of Union Budget 2020-21 here

Updated Date:

Subscribe to Moneycontrol Pro at ₹499 for the first year. Use code PRO499. Limited period offer. *T&C apply

also read

Sensex sheds 379 pts, Nifty below 15,200; ONGC, other gas stocks rally to 52-week high
Business

Sensex sheds 379 pts, Nifty below 15,200; ONGC, other gas stocks rally to 52-week high

While ONGC was the top gainer on BSE Sensex, the S&P BSE Oil and Gas index ended 632.03 points higher or 4.22 percent up at 15,609.10, a day after govt reaffirmed its commitment to bring natural gas under GST

GST collections cross Rs 1 lakh crore for fifth straight month, rise 7% to Rs 1.13 lakh crore in February
India

GST collections cross Rs 1 lakh crore for fifth straight month, rise 7% to Rs 1.13 lakh crore in February

The Union Finance Ministry said that the GST numbers 'clearly' indicate economic recovery, and the impact of various measures taken by tax administration to improve compliance

Centre released Rs 1 lakh crore GST compensation to states since Oct 2020, says Finance Ministry
India

Centre released Rs 1 lakh crore GST compensation to states since Oct 2020, says Finance Ministry

The Centre had set up a special borrowing window in October 2020 to meet the estimated shortfall of Rs 1.10 lakh crore in revenue arising on account of implementation of GST